Tokyo stocks hit new 21-month high

Other Asian markets mixed after a flat day on Wall St.

OsamuTsukimori

TOKYO (CBS.MW) - Tokyo stocks hit a fresh 21-month high Friday, led by techs and exporters like Sony and Honda, after the yen weakened to a five-month low against the dollar.

The Nikkei Average rose 135 points, or 1.2 percent, to 11,537.29, the highest close since June 6, 2002. The Nikkei rose a total of 4.5 percent this week.

The broader Topix gained 10 points, or 0.9 percent, to 1,131.01, its highest close since June 3, 2002.

"The stocks accelerated on a weaker yen and heavy buying orders by overseas investors," said Nagayuki Yamagishi, senior strategist at UFJ Tsubasa securities.

Other Asian markets were mixed after a flat day on Wall Street.

The yen rose to 111.16 yen in late Asia, up from 111.10 yen, late Thursday New York amid suspected interventions by the Japanese authorities, analysts said. It earlier touched 111.43 yen, the highest since Oct. 1, when it rose to 111.50 yen. Read full story.

In Japan, gainers outpaced decliners 847 to 557 in the First Section of the Tokyo Stock Exchange. Volume stood at 1.8 billion shares, down from 2.1 billion shares a day earlier.

Although a "healthy correction" is expected in the coming weeks, the Nikkei Average is definitely headed for the next key level of 12,000, said Norihiro Fujito, senior investment strategist at Mitsubishi Securities.

Semiconductor equipment maker Advantest
ADTTF, +0.95%
(6857) was flat at 8,680 yen. After the market closed the company said its board proposed boosting its dividend for the second half of the fiscal 2003 ending in March 31, by 10 yen to 25 yen per share, citing bright outlooks. The proposal will be submitted to the general shareholders meeting for approval in late June, it added.

Banking issues were mixed after a sharp rally this week. Mizuho Financial
MZHOF, +1.19%
(8411) gained 0.5 percent to 369,000 yen after falling as much as 4.1 percent. The Financial Services Agency called for a management reshuffle at its unit Mizuho Bank after finding insufficient loan-loss reserves in the wake of an inspection, the Asahi Shimbun reported.

Bank of Yokohama
BANKFM
(8332) surged 3.1 percent to 506 yen after the country's biggest regional lender confirmed it plans to pay back half of 200 billion yen ($1.8 billion) in public funds it borrowed from the government by May.

Lactic drink maker Yakult Honsha (2267) tumbled 5 percent to 1,625 yen after it announced an alliance with Groupe Danone
DA, +0.00%
It also said the French food giant, which holds a 20 percent stake in Yakult, has agreed not to increase its shareholdings and seek a majority stake for five years.

Kanebo
KABOF
(3102) jumped 11.7 percent to 124 yen after the Nihon Keizai newspaper reported that Japan's state-run agency may extend financial assistance to not only the cosmetics business, but also to the company's other operations.

Japanese bond prices fell in reaction to the stock rally as the yield of the key 10-year JGB rose 0.015 point to 1.425 percent.

Japan Data

On the data front, Japan's key gauge of the state of the economy stayed above the boom-or-bust line of 50 percent in January for the ninth straight month, the government said Friday. The index of coincident economic indicators came to 77.8 percent, above the 50 percent dividing line that marks whether the economy is expanding or contracting. The index of leading indicators, which is a predictor of economic moves about six months down the road, was 55.6 percent, the Cabinet Office said in a preliminary report.

Japan's foreign reserves hit a record high in February, up $35.61 billion from the previous month to $776.86 billion, the Finance Ministry said.

Meanwhile, overseas investors remained the net buyers of Japanese stocks for the third straight week. Nonresident investors bought a net 244 billion yen of stocks in the week ended Feb. 27, Tokyo Stock Exchange said.

In Hong Kong, the Hang Seng index was almost flat at 13,454. Top bank HSBC
HBC, -2.10%
(0005) fell 0.8 percent to HK$121.50.

In China, the Shanghai Composite fell 0.4 percent to 1,662 after Premier Wen Jiabao said Friday that China targeted a slower growth of "around 7 percent" this year from last year's 9.1 percent, AFP reported.

On Wall Street, the Dow edged up less than 0.1 percent, while the Nasdaq Composite fell 0.3 percent.

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